Guided Procurement

Companies typically use multiple buying channels to serve all the demand of their business units and end users. Typical buying channels include (but are not limited to):

Catalog

Request for quotation

Freetext requisition with the purchasing department

Contract call-off

Temporary labor requisition

Invitation to tender

Each buying channel has its own pros and cons. Where the process can be highly standardized as is repetitive (e.g., catalog-based procurement) the effort and cost are relatively low as compared to non-standardized processes that take long and are costly.

The aim of procurement departments is typically to push standardized processes and roll the out globally. Whenever possible, the end user should not make decisions whether buying channel A or B should be used, so he doesn’t choose the “wrong” potentially more costly way.

Since not all buying channels are equally available in all regions of the world (e.g., a Procurement Service Provider might not be available in Tajikistan), the monetary thresholds for certain buying channels might vary between regions and might be changed dynamically, it is a challenge for procurement departments to keep all potential requisitioners informed about the rules of procurement. Often, handbooks, intranet pages, collaboration spaces or regional procurement experts exist that guide and inform users about they should behave and about the buying channels that are best suited for the specific demand of the user.

Those approaches

do not scale with a large number of users that use the procurement system